Vireo Growth (VREO) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue rose 1.9% year-over-year to $24.5 million, with growth in Maryland, stable Minnesota results, and a 34% decline in New York medical sales partially offset by adult-use sales commencement.

• Adjusted EBITDA grew 8.5% to $6.6 million, with margins above 25% and a margin improvement to 26.8%.

• Operating income declined 58.5% to $2.0 million, with margin dropping to 8.1%.

• Net loss was $6.5 million, or $0.02 per share, compared to a $6.7 million loss in Q1 2024.

• Pending merger transactions are on track to close in Q2 2025, with regulatory and shareholder approvals obtained and integration progressing smoothly.

Financial highlights

• Q1 2025 revenue: $24.5 million, up 1.9% year-over-year; GAAP gross profit: $12.4 million, up 1.4%.

• Gross margin: 50.6% (down 20 bps year-over-year); adjusted gross margin would have been 51.8% excluding one-time fees.

• SG&A expenses: $7.5 million (30.5% of sales), up 6% year-over-year; adjusted for severance, flat at 29% of sales.

• Adjusted EBITDA: $6.6 million (26.8% margin), up 8.5% year-over-year.

• Cash on hand at quarter end: $86.3 million; total current assets (excluding NY assets held for sale): $128.5 million.

Outlook and guidance

• Merger transactions, including Utah acquisitions, expected to close in Q2 2025, with updates on the combined platform and outlook to follow.

• No anticipated integration issues; focus remains on building a portfolio of leading cannabis brands and growth in Maryland, Minnesota, and New York adult-use sales.

• Minnesota recreational sales expected to begin in 2025.